07:38 AM EST, 11/29/2024 (MT Newswires) -- Friday's key economic release at 8:30 a.m. ET is Canadian real gross domestic product, with results for Q3, September, and October flash.

Bank of Montreal (BMO) said it's looking for slower 1.3% annualized growth in Q3, down from 2.1% in Q2. The Bank of Canada's Monetary Policy Report call is slightly higher at 1.5%, while the Bloomberg consensus estimate is a bit lower at 1.1%.

An expected modest pickup in consumer spending and residential construction should be more than offset by weaker business investment following a strong rebound the prior quarter. Previously announced revisions to provincial GDP figures for the 2021-23 period flag a possible cumulative upward adjustment to the national level of around 1.3%.

However, it's the momentum that matters, stated the bank. Q3 likely ended on a soft note with September GDP expected to rise only slightly 0.1% month over month, though consensus sees 0.3% after a flat August.

Things are looking brighter for Q4, however, with sharp increases in retail sales and factory shipments and a spike in existing home sales suggesting a strong October flash gain that could pave the way for a return to plus-2% quarterly growth, pointed out BMO. Activity could be even stronger in Q1 2025, possibly in the high 2s, due to the GST holiday and C$250 Working Canadians Rebate.

Still, for a data-dependent BoC, an underwhelming Q3 growth print should keep it on track for a quarter-point rate cut on Dec. 11.

The Canadian dollar (CAD or loonie) is a touch firmer at C$1.400, despite WTI oil prices slipping to $68.5/barrel.